IRN - Indophil Resources

[skc]

I wonder who knew that the new government would put in alaw saying you can't open cut mine in the provence Tampakan is in? I wonder? Hmmmmm.

How about that for a black swan. Take the little swanny right up the hole IRN!



Surely logic and common sence will come to the fore and Tampakan will eventually be mined?

Maybe that was a good knife catch by someone?

I tend to agree with you. In fact today would have been a good catch already.

Perhaps a Chinese buyer can take it up and use political influence to change the law re open cut mining...

Do bribes still work in the Phillipines?

 

[Ajax]

Good shareprice rise today...up 6c to 90c on high volume.

There was a news article in the Philippines on 29 August suggesting that Philex Mining Corporation may be about to bid for Indophil.

"...The buzz is that Philex may be interested in buying the 37.5-percent stake held by Australian firm Indophil Resources NL, which is scouting for a new buyer for the block after talks with Chinese miner Zijin Mining Group bogged down..."

http://business.inquirer.net/money/topstories/view/20100829-289438/MVPs-golden-touch

And Philex's reply today to Philippines Stock Exchange query about this statement does not deny the possibility:-

http://philexmining.com.ph/images/stories/Philex/documents/News/dc2010-5908_px.pdf

More information about Philex Mining Corporation:-

http://philexmining.com.ph//index.php?option=com_content&task=view&id=14&Itemid=28

 

[Ajax]

Now the local press is picking up on the story.

Indophil becomes a takeover target again-Sydney Morning Herald

http://www.smh.com.au/business/indophil-becomes-a-takeover-target-again-20100902-14rsi.html

"A $550 million takeover of the Melbourne-based Philippine copper-gold group Indophil Resources is back on the cards after the July withdrawal by Chinese group Zijin with its $1.28-a-share offer."

Also in the Business Spectator this morning:-

http://www.businessspectator.com.au...o-fling-pd20100903-8WSL4?opendocument&src=rss

"The Philippines' biggest mining company Philex Mining Corp says it is mulling an investment into the $US5 billion-plus Tampakan project in the Philippines, in which Indophil owns a 37.5 per cent stake, alongside one-time suitor Xstrata."

 

[Ajax]

Have a look at comparisons of various copper projects on page 14 of this document:-

http://www.stocknessmonster.com/news-item?S=DML&E=ASX&N=223539

Shows estimated cash cost ($US/lb copper) on the vertical axis and estimated annual copper production in tonnes on the horizontal axis.

Indophil (IRN) is the clear winner when a combination of both variables is taken into account. Approx. 120,000 tonnes per annum estimated copper production at a cash cost of about US43c/lb.

 

[Ajax]

Indophil closed at 90c last week (Friday 3 September).

After the first 3 days trading this week it closed on Wednesday 8 September at 98c.

No news out this week.

Philex Mining Corporation (PX.PS) continues to have good announcements about its operations in the Philippines.

http://www.abs-cbnnews.com/business/09/06/10/philex-output-20-jan-aug

"MANILA, Philippines - The estimated value of minerals produced by Philex Mining Corp. rose 20% during the first 8 months of 2010.

Based on the firm’s disclosures to the Philippine Stock Exchange, production from January to August amounted to P7.42 billion compared to P6.2 billion in the same period last year, owing to increased tonnage, better ore grades and higher metal prices.

Philex produced 6.01 million dry metric tons, up 11% from last year's 5.43 million DMT."

I suspect a takeover bid from Philex at is just around the corner.

 

[Ajax]

Indophil closed at 99c today (Friday 10 September 2010) up 10% this week

Indophil has a 37.5% in Sagittarius Mining which in turn has a resource (Tampakan) containing:-

13.5 million tons of copper

(with spot copper prices near $US3.40/lb) and forecasts of copper at $US4.00/lb


and

15.8 million ounces of gold

(with spot gold price near record highs at $US1250/ounce)


The next bid for Indophil should be higher than the last bid of $1.28/share (given the increase in commodity prices and outlook for future commodity prices particularly copper)

However I fear I am talking to myself again (I suppose that's ok if I make the same $ this time around on a takeover for Indophil as I did in late 2009 when Zijin bid $1.28/share).

Am currently holding 380,000 Indophil shares.

 

[mr. jeff]

Indophil closed at 99c today (Friday 10 September 2010) up 10% this week

Indophil has a 37.5% in Sagittarius Mining which in turn has a resource (Tampakan) containing:-

13.5 million tons of copper

(with spot copper prices near $US3.40/lb) and forecasts of copper at $US4.00/lb


and

15.8 million ounces of gold

(with spot gold price near record highs at $US1250/ounce)


The next bid for Indophil should be higher than the last bid of $1.28/share (given the increase in commodity prices and outlook for future commodity prices particularly copper)

However I fear I am talking to myself again (I suppose that's ok if I make the same $ this time around on a takeover for Indophil as I did in late 2009 when Zijin bid $1.28/share).

Am currently holding 380,000 Indophil shares.

Gee AJAX,
I'm surprised you aren't holding more. (!) my God are you just hoping someone is watching this space? I' watching, but not that familiar with the IRN story, will work on this over the w/e; seems you have a good line on it.

Keep it on the radar I guess, sometimes its funny that there might be 2 people on a thread making 30% in a week and others scattered throughout losing money... communication is a trick!

 

[Sean K]

Ajax,

What's the latest on the local government there not allowing open cut mining? I haven't seen any recent news on that, or even if it's official. Surely the national government would be trying to get such a large project off the ground. Maybe the local environment is going to be smashed by such a hole in the ground...

They'll probably come around one day, but while you have such a hurdle to jump why put so much into one basket? Maybe that's not much for you...

 

[Ajax]

Hi Kennas,

it is a lot for me.

Agree the open cut mining ban is an issue. I believe it will be rescinded as the Tampakan project will generate a huge amount of tax revenue for the Philippines economy

http://www.bworldonline.com/main/content.php?id=16451

http://business.inquirer.net/money/topstories/view/20100829-289438/MVPs-golden-touch

http://www.manilastandardtoday.com/...0/august/20/peterwallace.isx&d=2010/august/20

"For example I’m worried about some of the reported statements of Secretary Ramon Paje in relation to Tampakan. Anyone who truly cares to do something about the appalling level of poverty must come out forthrightly in support of the biggest investment this country has ever had. Yes, it will have some impact on the environment, but this can be controlled by the Secretary with his other hat on? And a bond placed, which the law requires, to put the land back into the same or better shape than it is now when the mine is finished. So I hope he agrees and works for a solution that is best for all.

The President needs to step in here now because if he doesn’t, not only will a US$5 billion investment be lost, but other mining companies will re-think their interest and look for other countries with more predictable policies. One where bans on their business don’t suddenly appear. Foreign investment generally will also be deterred: If it can happen in mining, it can happen in other sectors too.

Foreign Direct Investments dried up under Mrs. Arroyo’s term (a miserable US$1.9 billion last year) because of the capricious policy-making of her government. P-Noy, on the edge of a trip to the United States to attract investment can’t go with this hanging over his head."

 

[Ajax]

Ajax,

What's the latest on the local government there not allowing open cut mining? I haven't seen any recent news on that, or even if it's official. Surely the national government would be trying to get such a large project off the ground. Maybe the local environment is going to be smashed by such a hole in the ground...

They'll probably come around one day, but while you have such a hurdle to jump why put so much into one basket? Maybe that's not much for you...

Kennas,

there is some information in Indophil's interim financial report released today
(13 September 2010) which partially answers your question

"On 11 June 2010, the Company requested a trading halt on the ASX in order to seek clarity on Philippine media reports that the South Cotabato provincial council (jurisdiction in which the Tampakan mine site is located) may pass a new Environment Code that includes a ban on open pit mining. The outgoing provincial governor approved the code on 29 June 2010. The Company
resumed trading on 14 July 2010. The Company has been advised that the code has not yet been formally gazetted and therefore has not taken effect.

At a national level in the Philippines, there has been strong public support from the President, Benigno Aquino III, to resolve the issue of a proposed open pit ban in South Cotabato. At the provincial level, the relevant local government unit that formed after the May 2010 elections has recently expressed a willingness to review the Environment Code and, in particular, section 22 of that code in which the proposed open pit ban gains are mentioned. Indophil remains confident that this issue will be resolved, although at this stage, the position remains unresolved. In the meantime, field and study work continues unabated on the Tampakan project. "

and with respect to a potential takeover bid for Indophil

"Process relating to Potential Sale of Indophil’s Tampakan Interest

On 25 June 2010, the Company and Zijin Mining mutually agreed to terminate the Takeover Implementation Agreement in respect of Zijin Mining’s takeover bid for Indophil, due to continued delays in relation to fulfilment of Bid Conditions. Following the mutual termination of the Takeover Implementation Agreement with Zijin Mining, Indophil advised that it is continuing to seek to maximise shareholder value and is in dialogue with a range of interested parties in relation to a potential corporate transaction.

The Company remains confident that it will secure, in a reasonable timeframe, an acceptable corporate transaction, and will keep shareholders informed of developments."

 

[Ajax]

Philex CEO: In Talks To Raise Tampakan Stake

Just out on Dow Jones news wires

"Philex Mining Corp. (PX.PH) said Wednesday that it is in discussions with Indophil Resources NL (IRN.AU) to possibly raise to raise its stake in the Tampakan copper-and-gold project in the southern Philippines. "

Whole report here:-

http://www.tradingmarkets.com/news/...mpakan-copper-gold-project-stake-1169210.html

 

[Ajax]

HK based First Pacific Co may bid for Indophil

This is the majority shareholder in Philex Mining Corp (whose discussions with Indophil have been previously reported)

http://www.manilastandardtoday.com/...eptember/15/business1.isx&d=2010/september/15

"...Hong Kong-based conglomerate First Pacific Co. Ltd., meanwhile, is considering the possibility of investing in the Tampakan project through Indophil Resources NL, which holds a 37.5-percent stake in the largest untapped gold and copper deposit in Southeast Asia.

First Pacific chief executive Manuel Pangilinan in a separate interview said talks of a possible investment in Tampakan would be done through First Pacific, which is also the majority shareholder of Philex Mining Corp., the countrys most profitable and biggest mining company.

We are considering investing in Tampakan through Indophil, Pangilinan said.

When asked if First Pacific was interested in Indophils entire 37.5- percent interest in Tampakan, Pangilinan said it depends."

 

[Ajax]

Copper is currently trading at $7,700/tonne.

Forecasts are for a copper price up to $US10,000/tonne by 2013.

With Tampakan having 13.5 million tonnes of copper, that's the equivalent of gross sale proceeds of $US135,000 million from Tampakan (and Indophil's 37.5% share equal to gross sale proceeds of just over $US 50,000 million).

With approx. 426 million shares on issue (on a fully diluted basis) this equates to gross sale proceeds per Indophil share of approximately $US117.

This calculation leaves out proceeds from the sale of 15.8 million ounces of gold from Tamapakan.

From Minesite article on copper (password required)

http://www.minesite.com/

"If copper hits $US10,000/tonne it would be a mixed blessing for investors"

...

" This year the countries covered by the OECD are expected to grow by 2.7 per cent and then to grow by another 2.8 per cent in 2011. And remember that China and other fast growing emerging economies are not in the OECD, so are not included in these data.

So if inventories are this low before growth really gets going, what might happen to them if global growth is maintained and supply does not keep pace? In such a scenario there would be a price response similar to that which drove nickel to US$50,000 a tonne at the peak of the last boom in 2007. And on that basis it is quite conceivable that copper could reach US$10,000 a tonne. "

...

"The research also carries a forecast that by 2013 the price of copper will average US$9,500 a tonne, so a spike above US$10,000 is entirely feasible"

 

[Ajax]

Street Talk page 22 AFR today

"The latest word is that the sales process, led by Gresham Partners, has drawn six parties in due diligence."

"...its nearing the pointy end"

Contenders suggested are:

Philex Mining (has admitted its interest), MMG (Philippines division of Minmetals), possibly BHP, Antofagasta, Barrick Gold or Newmont Mining.

Article suggests that some gold majors are increasingly eyeing large copper-gold deposits (and Tampakan has 15.2 million ounces of gold).

 

[Ajax]

The two interested parties from Philippines are Philex Mining Corp (via its 46% major shareholder Hong Kong listed First Pacific co) and possibly MMG (which is the Philippine's subsidiary of Minmetals, run by Andrew Michelmore).

I have heard that Xstrata would prefer a Philippines based partner for Tampakan. This makes sense given the politics and various interest parties. Local knowledge would surely be preferable.

To what extent Xstrata may need to go to ensure a local partner for Tampakan (Sagittarius Mines Inc) is yet to be seen.

 

[Ajax]

With copper spot price now $US7,876/tonne and gold spot price now $US1298/ounce the gross value of Indophil's 37.5% interest in Tampakan is as follows:-

Copper

15.8 million tonnes x $US7,876/tonne x 37.5%

= $US124,440.8 million x 37.5%

= $US46,665.3 million

Gold

13.2 million ounces x $US1,298/ounce x 37.5%

= $US17,133.6 million x 37.5%

= $US6,425.1 million

Total gross value of Indophil's copper and gold at current spot prices

= $US46,665.3 million + $US6,425.1 million

= $US53,090.4 million


Converting to AUD at current exchange rate of 0.9554

= $US 53,090.4 million/.9554

= AUD 55,568.76 million

With 426.028 million Indophil shares on issue (on a fully diluted basis) this equates to a gross resource value per share of

AUD 55,568.76 million/426.028 million shares

= AUD 130.43/share

Even in the toughest of financial exercises if this gross resource value is reduced by a factor of 100 taking into consideration production costs/political risk/uncertainty etc this still leaves a value of AUD1.3043 per Indophil share (well above the 97c/share close last Friday). The calculation does not yet factor in proceeds from sale of molybdenum byproduct or the considerable exploration upside with Tampakan.

 

[Ajax]

Philippines lised Philex Mining "has tapped" its listed subsidiary company, Philex Petroleum Corp, in an asset reorganisation.

You need to ask yourself why does Philex Mining need to "tap" the cash balances of other listed companies in the Philex Group?

Particularly in the light of earlier reports mentioning Philex Mining Corp and Indophil-

"Philex Mining Corp. (PX.PH) said Wednesday that it is in discussions with Indophil Resources NL (IRN.AU) to possibly raise to raise its stake in the Tampakan copper-and-gold project in the southern Philippines. "

http://www.tradingmarkets.com/news/...mpakan-copper-gold-project-stake-1169210.html

The more recent report here:-


http://www.philstar.com/Article.aspx?articleId=615872&publicationSubCategoryId=66

"MANILA, Philippines - Publicly-listed Philex Mining Corp. has tapped its wholly-owned subsidiary Philex Petroleum Corp. to handle all the groups energy assets.

In a disclosure to the Philippine Stock Exchange (PSE), Philex president and COO Jose Ernesto Villaluna Jr. said the transfer of the assets is consistent with reorganization of the company.

This is pursuant to an internal reorganization whereby all of the companys energy assets are to be held through Philex Petroleum, he pointed out."

"Philex said the assets that would be included in the transfer are the company?s shares of stock, representing 15.75 percent of Pitkin Petroleum Corp., a public limited company organized under the laws of the United Kingdom. Pitkin is involved in oil and gas exploration and production and has interests in Vietnam, Peru, Philippines and the US.

The company said shares of stock, representing 51.24 pecent of FEC Resources Inc., a Canadian corporation which holds 25.63 percent of Forum Energy Plc, a UK company listed on the Alternative Investment Market of the London Stock Exchange, will also be covered in the transfer.

This is in addition to the 38.82 percent that Philex Petroleum directly holds in FEP (Forum Energy), which has a 70 percent interest in Service Contract 72 covering the Sampaguita gas fields in northwest Palawan,? Villaluna said.

Aside from these shares, Philex will also transfer 100 percent of Brixton Energy & Mining Corp., a local coal mining company that holds Coal Operating Contract 130 covering areas located in Diplahan and Buug in the province of Zamboanga Sibugay.

Philex said it has also been given approval by the Department of Energy (DOE) to transfer the company?s interests in SC 41 (South Sulu Sea), 2.264 percent; SC 6 (Cadlao block), 1.65 percent and SC 6 A (Octon block), 5.6 percent to Philex Petroleum." 

 

[Ajax]

Gold and Copper price rising strongly

Another reason for Philex Mining Corp and others to bid soon.

Copper September 28,14:47
Bid/Ask 3.6030 - 3.6075
Change +0.0140 +0.39%
Low/High 3.5890 - 3.6075


GOLD SPOT MARKET IS OPEN
closes in 22 hrs. 54 mins.
Sep 28, 2010 18:21 NY Time
Bid/Ask 1308.50 - 1310.30
Low/High 1278.60 - 1311.20
Change -0.50 -0.04%
30daychg +70.40 +5.69%
1yearchg +318.00 +32.10%

 

[Ajax]

Brazil's Vale joins Indophil suitors

Page 28 Fin Review Street Talk today

Article is headed-Indophil counts the hours as Vale joins suitors.


"It's understood that Brazilian miner Vale is a potential suitor for exploration group Indophil, which is racing against the clock to find an investor.

Vale is thought to be among a group of six parties in due diligence over Indophil, which has attracted the interest of the largest mining company in the Philippines, Philex Mining."

From Vale's web-site:-

Mining is Vale’s core business. To sustain our growth strategy, we are actively engaged in mineral exploration in 21 countries.

Vale’s operations are presently divided as follows:

Iron ore and pellets: 59.2%*
Nickel: 13,6%*
Coal: 2.1 %*
Aluminum: 8,6%*
Manganese and ferro-alloys: 2,2%*
Copper: 4,7%*
Other: 1,2%
* Figures from the first quarter of 2010 referring to operating revenue per product

 

[Ajax]

Indicators that the Tampakan mine will be a reality

Recent job advertisements for Tampakan:-

Tenements Officer

http://xstratajobs.nga.net.au/cp/in...&persistVariables=JobListID,jobsListKey,JobID

Geotechnical Aide at Kiblawan And Tampakan

http://www.jobopenings.ph/page_job_details.php?jobid=42955&companyid=3115

Leadmen - Drilling And Logistics at Tampakan/ Kiblawan

http://www.jobopenings.ph/page_job_details.php?jobid=42802&companyid=3115&noupdate=1

Security supervisor-east

http://xstratajobs.nga.net.au/cp/in...1269F43&jobsListKey=c5dd34f9-6f09-486f-834a-f

Project Scheduler

http://xstratajobs.nga.net.au/cp/in...obs.listJobs&ApplicationID=&audienceTypeCode=

and comments made by the Aquino administration in US on Tampakan:-

http://www.abs-cbnnews.com/nation/10/02/10/pnoy-eyes-450000-more-jobs-passage-us-trade-bill

"WASHINGTON D.C. - A week after President Aquino?s visit to the United States, Philippine trade consul Romulo Manlapig says he still couldn?t shake off the words that rang like a persistent echo in his ears ? ?jobs, jobs, jobs?.

The President told a global town hall meeting in San Francisco ? aired over ABS-CBN?s The Filipino Channel ? other officials are coming to America to follow-through on business opportunities that caught his attention.

He may have been talking about Trade Undersecretary and Board of Investment chief Cris Panlilio, who started working the Washington DC circuit shortly after the President flew for home.

The President, Panlilio averred, seems obsessed by the need to generate jobs in the Philippines. He corroborated Manlapig?s half-humorous tale about how President Aquino drove home his message of ?jobs, jobs, jobs? to Philippine officials here"

...

"Panlilio said the Aquino administration is pursuing three major economic initiatives- minerals (e.g. $6 billion Tampakan gold and copper mine in South Cotabato and the $2.5 billion Oceana gold mine in Nueva Vizcaya); resurrecting the car making and automotive components export sector; and passage of the Save Our Industries Act in the US Congress"